Small is Beautiful: A Study of Economics as if People Mattered, by Dr E.F. Schumacher

2019-07-04T14:18:44+00:0027/05/2019|

This classic book, first published in 1974, is still in print and still selling. Yet it may shock the first-time reader to see that many of the author’s suggestions – made 45 years ago – have yet to be acted upon. In some respects, the negative trends identified by Schumacher have become more extensive.

The main one of these is that human beings are treated in an essentially inhuman way by the machinery of modern technocapitalism. People have been using the term ‘the machine age’ for so long that it sounds even corny today. But that doesn’t mean that we are not increasingly losing out to automated processes that render human activity boring and pointless. It may surprise many to learn that computers and robots are much better at doing interesting jobs than dull ones. A machine can replace a skilled woodworker or even a journalist, but a robot designed to fold sheets is about thirty times slower than a human being. Likewise cleaning bathrooms and toilets: machines fail there too. How odd if we allow a future to develop in which robots rule and humans deal with the dirty laundry left behind…

By some bizarre irony – which Schumacher points out – craft trades from the past can only be practised now by those with ample time and money. And yet they used to be how an ordinary person made a living. Schumacher also notes on his wide travels that the level of technological uptake in a country is directly related to how much free time people have. It’s counter-intuitive. Instead of machines creating leisure time (as was widely predicted in the 1970s), they force us to be under more time pressure. Just look at how the internet and the ever-present need to text and email have left the average Westerner generally over-stretched.

The central tenet of the book is that although certain economic gains are made by scaling up, human beings lose out when they are herded into larger and larger groups. The so-called Dunbar number that comes from primate research suggests that humans cease to be as empathetic when they live in groups numbering more than 150, simply because they can’t know more people than that. Small isn’t just beautiful, it’s human.

But Schumacher goes beyond this to show that an infatuation with constant expansion isn’t actually efficient. It wastes resources and destroys environments and can even result in the collapse of an entire industry. Just as a virus can kill off a single population, huge unitary concerns are far more vulnerable to economic upsets than large numbers of smaller firms.

Schumacher was an economist first, then, believing theory was not enough, he tried both farming and running his own company, which still exists today: Scott-Bader. He was a president of the Soil Association and was influential in many areas involving intermediate and sustainable technology. He was, above all else, a sensible, humane man who did not put economic theory above observable practice. The book details the flaws in many economic assumptions: that complex technology is inherently cheaper than simpler technology, that a bigger factory is always a more efficient factory, that progress is always about making computers smaller and organisations bigger.

Man is a small creature but he easily gets big ideas. The left hemisphere of the brain, when it runs away with itself, becomes very easily megalomaniacal, with no ‘off’ button. For that is what separates man from any form of artificial intelligence: knowing when to stop, when to switch to ‘off’, or ‘stop running the program’. For it is judgement that it is needed both for starting and stopping things, and judgement is something occluded when things grow beyond their humanly useful size, or when they embark on growth for the sake of growth. A wiser approach is to ask what is the size of any entity that best suits its purpose and best aligns with a sustainable, optimistic and encouraging future? Anyone who toils in the vast warehouse of an internet sales firm has an inkling about the limitations of grandiosity: the anomie-inducing toll of dull work in an artificial environment. We owe it to ourselves and our children to cease accepting megabusiness as the only way to live in the 21st century. Indeed, the success of small town councils taking control of their own power generation is a sign that newer, more compact technology can be used to bring things down in scale.

Schumacher was nearing the end of a productive and interesting life but he was far from sanguine about the future. He understood that we stray from our own nature at our peril:

‘Man is small and therefore small is beautiful. To go for giantism is to go for self-destruction.’